Final Settlement with Partner (Dissolution)

Q. On dissolution of the firm, partner’s capital accounts are closed through account.

1. bank
2. asset
3. liability
4. reserve

Q.

Journalise the following transactions regarding Realisation expenses:

[a] Realisation expenses amounted to Rs 2, 500.

[b] Realisation expenses amounting to Rs 3, 000 were paid by Ashok, one of the partners.

[c] Realisation expenses Rs 2, 300 borne by Tarun, personally.

[d] Amit, a partner was appointed to realise the assets, at a cost of Rs 4, 000. The actual amount of Realisation amounted to Rs 3, 000.

Q.

If a partner takes over an asset, such Partner’s Capital Account is __________________.

1. None of the above

2. either A or B

3. Credited

4. Debited

Q. Amrit Ltd . was promoted by Amrit and Bhaskar with an authorised capital of ​₹ 10, 00, 000 divide into 1, 00, 000 shares of ​₹ 10 each.
The company decided to issue 1, 000, 6% Debentures of ​₹ 100 each to Amrit and Bhaskar each for their services in incorporating the company.
Pass journal entry.

Q.

On dissolution of the firm, partner’s capital accounts are closed through _________

1. Bank account

2. Realisation account

3. Current account

4. Capital account

Q. A company issued 30, 000 fully paid-up shares of ₹ 100 each for purchase of the following assets and liabilities from Sharma Co:

Plant	₹ 7, 00, 000	Stock-in-Trade	₹ 9, 00, 000
Land and Building	₹ 12, 00, 000	Sundry Creditors	₹ 2, 00, 000

You are required to pass necessary journal entries.

Q.

Realisation expenses to be borne by Rashim for which he will be paid Rs. 70, 000 as remuneration for completing the dissolution process. The actual expenses incurred by Rashim were 1, 20, 000. How will you deal with realisation expenses of the firm of Rashim and Bindiya-

1. Realisation A/c Dr. 70000

   To Rashim's Capital A/c 70000

2. Realisation A/c Dr. 70000

   To Realisation A/c 70000

3. Bank A/c Dr. 70000

   To Rashim's Capital A/c 70000

4. Realisation A/c Dr. 120000

   To Bank A/c 120000

Q. When we have received money on realisation of assets. It is shown on the debit side of account.

1. realisation
2. revaluation
3. bank
4. capital

Q.

There was an old computer which was written off in the books of accounts in the previous year. The same has been taken over by a partner Nitin for Rs. 3, 000. Journalise the transaction supposing the firm has been dissolved.

1. Nitin's Capital A/c Dr. 3000

   To Realisation A/c 3000

2. Bank A/c Dr. 3000

   To Realisation A/c 3000

3. Nitin's Capital A/c Dr. 3000

   To Bank A/c 3000

4. Realisation A/c Dr. 3000

   To Realisation A/c 3000

Q.

When the unrecorded asset is sold for cash, realisation account will be …………….

1. debited

2. credited

3. Not sure

4. None of these

Q.

There was an old computer which was written-off in the books of Accounts in the pervious year. The same has been taken over by a partner Nitin for Rs 3, 000. Journalise the transaction, supposing. That the firm has been dissolved.

Q. After realisation of all assets and paying off liabilities, the partners share the remaining cash & bank balances according to the partners' balance.

1. capital
2. bank
3. asset
4. liability

Q.

How will you deal with the Realisation expenses of the firm of Rashim and Bindiya in the following cases:

1. Realisation expenses amounts to Rs 1, 00, 000,

2. Realisation expenses amounting to Rs 30, 000 are paid by Rashim, a partner.

3. Realisation expenses are to be borne by Rashim for which he will be paid Rs 70, 000 as remuneration for completing the dissolution process. The actual expenses incurred by Rashim were Rs 1, 20, 000.

Q. The debit balance of the bank account as per the cash book should be equal to the credit balance of the account of the business in the books of the bank.

1. true
2. false

Q. Credit balance of bank account in cash book shows ______________.

1. Overdraft
2. Cash deposited in our bank
3. Cash withdrawn from bank
4. None of the above

Q. State whether the following statements are True or False.

Capital account always shows credit balance.

Q. Debit balance as per cash book means _________.

1. Cash Balance
2. Overdraft
3. Excess of Expenditure
4. None of these

Q. If partners maintain both fixed capital and current accounts, which of the following would normally be credited to a partner's capital accounts?

1. Profits on revaluation
2. Losses on revaluation
3. Interest on capital
4. Goodwill being written off

Q. The Cash account of the balance sheet should not include which of the following items?

1. Travel advances to employees
2. Currency
3. Money orders
4. Deposits in transit

Q. Which of the following statement is correct?

1. The ownership of goods will be transferred to consignee at the time of receiving the goods.
2. Consignee will pass a journal entry in his books at the time of receiving goods from consignor.
3. Consignee will not pass any journal entry in his books at the time of receiving goods from consignor.
4. Consignee will treat consignor as creditor at the time of receiving goods.

Q. Debit balance as per pass book means ____________.

1. none of these
2. bank overdraft
3. debit balance in pass book
4. cash balance with bank